BANK EMPLOYEES UNION versus RAJARSHI SHAHU GOVT. SERVANTS CO-OPERATIVE BANK LTD., KOLHAPUR on 6 July 2021

1. Leave granted.

2. The short question that arises in this appeal is as to whether theappellant – Registered Trade Union - had locus to prefer an applicationto modify a standing order that applies to the employees of the respondentGunder Section 38(2) of The Maharashtra Industrial Relations Act, 1946.The brief facts necessary in order to dispose of this appeal are as follows:- The original standing order with which we are concerned, andwhich stated the age of retirement of the employees of the bank, readsas follows :-H

“22(7) Every employee shall retire from service on attainingthe age of 55 years, Extension not exceeding one year at atime or three years in all may be given at the discretion of thepresident.”

3. By two Agreements dated 11.01.2004 and 21.02.2010 whichwere settlements under Section 18(1) of the Industrial Disputes Actentered into between the respondent and its employees, it was agreedvide Clause 16 of the 2004 settlement and Clause 15 of the 2010 settlementthat the retirement age would now be 58 years. A reference was madeunder Section 73A of The Bombay Industrial Relations Act (as it wasthen styled) to the Industrial Court, which then made an award in termsof the two settlements entered into. This award was dated 10.03.2010.However, when it was pointed out that formalities under the MaharashtraIndustrial Relations Act in modifying the standing order 22(7) needed tobe gone through in order to implement the two settlements whichculminated in an award, the appellant – Registered Union - filed anapplication on behalf of the employees dated 26.04.2011 under Section38(2) of the said Act. Armed with the consent letter from various otherunions dated 04.09.2012, the application was heard by the AdditionalLabour Commissioner. The Additional Labour Commissioner, vide hisorder dated 25.10.2012, recorded as follows :- “As the employees of the said Bank are also employed in otherdifferent local areas of viz. Tasgaon, Kavathe Mahankal,Khanapur, Atpadi, Jath, Shirala, Walwa, Miraj, Palus,Kadegaon talukas and they are represented by KolhapurDistrict Bank Employees Union, Kolhapur which is therepresentative and approved union for Banking Industry forthe abovesaid local areas, the said union’s views were obtainedin accordance with the provisions of sec. 39 (1) of the BombayRelations Act, 1946. The said union by their letter dated 04/09/2012 conveyed that they have no objection in the matterof settlement of alteration to the said Standing Order.

In accordance with the provisions of section 39 (1) of theAct, the management of the said Bank was requested to filetheir say in respect of the proposed alteration. The Bank bytheir communication dt. 19/03/2012 communicated theirvarious objections objecting the union’s proposed alteration,but the management of the Bank could not refute the fact that A

B

C

D

E

F

G

H

Athey have made two settlements dated 11/01/2004 and 21/02/2010 wherein the management Bank has agreed to alter theretirement age of their employees from 55 to 58.

As both the parties i.e. the employees through theirrepresentative unions, and also the management of the saidBBank have already mutually made the agreements to effectthe change in retirement age, I find no difficulty to make thealteration to the Standing Order clause No. 22(7) which willread as under :- Standing Order No. 22 (7) – Every employee shall retire fromCservice on attaining the age of 58 years . Extension notexceeding one year at a time or three years in all may begiven at the discretion of the President.”

4. However, an appeal was filed by the Bank in November 2012against the said order, in which essentially one point was taken up, whichDwas that under Section 38(2) of the Maharashtra Industrial RelationsAct, only an employee, as defined under the said Act, could apply to theCommissioner of Labour for an alteration of a standing order and theRegistered Union, being separately defined, would therefore have nolocus to do the same. This appeal was allowed by the Industrial Court,on a conspectus of the provisions of the said Act, that the appellantEUnion would have no locus to approach the Commissioner of Labourunder Section 38(2) of the Maharashtra Industrial Relations Act, as onlyan employee defined under the said Act would be allowed to do so. Inaddition, the Industrial Court, being troubled about the fact that, by itsorder, the bank would be allowed to resile from the two settlementsFentered into, the court’s consciencespoke out thus :- “10) No doubt, the Appellant Bank had executed an Agreementwith the Opponent Union and in the said Agreement, it wasdecided to change the age of retirement from 55 years to 58years. But, the Appellant Bank has made change in its StandingGOrders by moving an application under Section 38(2) of TheBombay Industrial Relations Act, 1946. This act of theAppellant Bank shows the attitude of the Bank towards itsemployees. On the contrary, it was for the Appellant Bank tobecome a model employer by moving an application underSection 38(2) of the said Act for change in the age of retirementHof its employees from 55 to 58 years and the same is not done.

Undisputedly, the Agreement states about the change in theage of retirement that does not mean that the law has givenright to the Union to file an application under Section 38(2)of The Bombay Industrial Relations Act, 1946.”

5. From this order, a writ petition was preferred by the appellant.By the impugned Judgment dated 18.12.2014, after an exhaustive surveyof the said Act, it was found that the Industrial Court’s order could notbe interfered with, and, as a result, the writ petition was dismissed.

6. Mr. Colin Gonsalves, learned senior counsel appearing on behalfof the appellant, has taken us through the provisions of the Act in copiousdetail and has argued that on merits, his client would certainly havelocus, particularly given Section 27A of the said Act, which has not beenviewed by the impugned Judgment in its correct perspective. In anyevent, he added that it would be preposterous to allow a party to asettlement, who, in fact, ratifies the aforesaid settlement, to resiletherefrom at a stage of Ministerial implementation. He, therefore,submitted that the appeal made against the learned Additional LabourCommissioner’s order to the Industrial Tribunal ought to have beendismissed on the ground that since either the employer or the employee,or both, could have gone to the Commissioner of Labour to implementthe two settlements entered into, it would not lie in the mouth of theemployer to now turn around and take up a technical plea of locus whenthe employer itself could and should have approached the LabourCommissioner under Section 38 to implement the two settlementssolemnly arrived at between the parties.

7. Sh. Vinay Navare, learned senior counsel appearing on behalfof the Bank, supported the Judgment of the Bombay High Court andtook us in copious detail through the provisions of the Act and the standingorders. According to him, once it is seen that the definition of ‘Employee’and “representative Union” is different, and once it is also seen thatunder various other provisions of the Act, more particularly Section 42,an ‘employee’ and a ‘representative union’ have both been referred toseparately, as opposed to Section 38 which speaks only of an ‘employee’,obviously a representative union would have no locus to move anapplication under Section 38, and the Judgment under appeal ought notto be disturbed at all. He, however, makes a submission that in case thisCourt were not to accept his submission, the matter could be sent backto the Commissioner of Labour for a reconsideration on merits after A

B

C

D

E

F

G

H

Aadding one or more employees, so as to take care of the technical objectiontaken.

8. After hearing both the learned senior counsel appearing for theparties at length, we do not propose to disturb the impugned Judgmenton merits. Having regard to the facts of this case, it is clear that theBoriginal standing order which mandated 55 years as the age of retirement,was changed by consent of both employer and employees, to 58 years,not just once, but twice, by means of Settlements of 2004 and 2010,solemnly entered into under Section 18(1) of the Industrial Disputes Act.Not only this, these settlements were also sanctified by an award of theIndustrial Court dated 10[th] March, 2010. Ultimately, as correctly arguedCby Mr. Gonsalves, the Ministerial duty of implementing the settlementwas on both the employer and the employees. It so happened that theappellant moved an application before the Commissioner of Labour. Thesaid application could and should have been joined in by the employer,and in this backdrop, it would be clear that any technical objection as toDa registered union having no locus to file an application under Section38(2) of the said Act, cannot be countenanced. We, therefore, set asidethe order that has been passed by the Industrial Court, which was onlybased on the locus standi of the appellant, and hold that the IndustrialCourt ought to have given some teeth to Paragraph 10 of its own Judgmentand held that the very appeal which was filed before it be dismissed forEthe very good reason that the bank should not be allowed at the stage ofimplementation of two settlements (culminating in an award) solemnlyentered into between itself and its employees, to now turn around andquestion the locus standi of the appellant. On this narrow ground, therefore,this appeal is allowed and the Judgment of the Industrial Court dated F14[th] March, 2013 and, consequently, the judgment of the High Court isset aside. We reiterate that we are not, in any manner, disturbing theHigh Court Judgment on merits, leaving the question of law decided byit open. All consequential benefits, as a result of this Judgment, to theemployees of the respondent, be given within a period of six monthsfrom today.G

Pending interlocutory application(s), if any, is/are disposed of.

H

Nidhi Jain

Appeal allowed.